Asked by Madeline Suderman on Jun 28, 2024
Verified
If the entity has a discontinued operation, then it must also calculate and disclose the:
A) basic earnings per share ratio only for the discontinued operation in the statement of profit or loss and other comprehensive income.
B) diluted earnings per share ratio only for the discontinued operation in the statement of profit or loss and other comprehensive income.
C) basic and diluted earnings per share ratios for the discontinued operation in the statement of profit or loss and other comprehensive income.
D) basic and diluted earnings per share ratios for the discontinued operation in the statement of profit or loss and other comprehensive income only if the discontinued operation contributed a profit in the current reporting period.
Discontinued Operation
A component of a company's business that has been sold or discontinued, with its results reported separately in the financial statements.
Comprehensive Income
The change in equity of a company during a period from transactions and other events from non-owner sources. It includes all revenues, gains, expenses, and losses.
- Comprehend the treatment of discontinued operations in EPS calculation.
Verified Answer
ZK
Zybrea KnightJul 05, 2024
Final Answer :
C
Explanation :
When an entity has a discontinued operation, it must calculate and disclose both basic and diluted earnings per share ratios for the discontinued operation in the statement of profit or loss and other comprehensive income. This is required regardless of whether the discontinued operation contributed a profit in the current reporting period.
Learning Objectives
- Comprehend the treatment of discontinued operations in EPS calculation.